On December 17, 2014, in Baker et al v. Anschutz Exploration Corporation, et al, a federal judge ruled against nine New York homeowners who sought $2 billion in damages and claimed their drinking water was contaminated by a nearby natural gas well. U.S. District Judge Charles Siragusa (WDNY, Rochester) concluded that the homeowners failed to prove by expert proof that the silt and methane that befouled their water was caused by one of two gas wells drilled in 2010, located approximately one half mile from their homes.

Plaintiffs rely on individual wells for all their water. Defendant Anschutz Exploration Corporation (“Anschutz”) operated two natural gas wells in the Trenton-Black River sandstone formation, Town of Big Flats, Chemung County, New York.

Plaintiffs claimed that one of the Anschutz wells contaminated their well-water, and sued under principles of negligence, negligence per se, nuisance, premises liability, strict liability under NY Navigation Law, NY General Business Law, and trespass. Plaintiff homeowners claimed muddiness, natural gas, iron and methane contaminated their water wells, and that their wells were never contaminated prior to the Anschutz drilling. County testing confirmed that the well-water contained methane, a main component of natural gas, and Plaintiffs retained an expert hydrologist who concluded that the methane likely migrated from the gas wells through a network of bedrock fractures.

Defense experts hired by Anschutz contradicted Plaintiffs’ experts’ conclusion, using actual laboratory analysis, and determined that the methane in the water didn't originate in the geological formation nearly two miles deep that was tapped by the gas wells. The proof showed that Anschutz drilling method did not involve hydraulic fracturing (“fracking”), but rather straight vertical drilling methods.

The record before the Court also provided that the Department of Environmental Conservation inspected the two Anschutz wells more than 50 times during construction, and Anschutz complied with all permit conditions, applicable laws, and regulations. It also opined that the well water problems were more likely associated with seasonal low-water levels in an aquifer where shallow pockets of naturally occurring gas were known to occur. This information was available to both Plaintiffs’ and Defendant’s experts.

The Court granted summary judgment for Anschutz, finding first (in relation to Anschutz’s motion to exclude findings of Plaintiffs’ expert) that the testimony of Plaintiffs’ expert hydrologist was not based on sufficient facts or data; was not the product of reliable principles and methods; and did not apply the principals and methods reliably to the facts of the case. The Court concluded that Plaintiffs’ expert was unreliable and unqualified to testify as to causation. The Court further found that even if Plaintiffs’ expert was qualified to testify, his testimony was pure speculation and opinion, and not supported by actual test findings.

The practical implication of this decision is that plaintiff’s expert proof, including proof on causation, must satisfy Daubert principals. The other practice pointer is the importance of removing a case to federal court (if possible) in order to take advantage of the Daubert standard.

If you require further information regarding the content presented in this Legal Alert and its impact on your organization, please contact Thomas B. Cronmiller, Chair of the Torts & Products Liability Defense Practice Area, at (585) 295-4424 or tcronmiller@hblaw.com.